I am thinking of selling my business – what do I need to know?

9th October 2017 Business advice CHW Accounting

At CHW Bolton Accountants we are often approached by our clients who are considering selling their business.

Selling a business is a time-consuming and very involved process. From researching the market and finding a potential buyer, to managing the due diligence process and negotiating the various legalities, there is undoubtedly a lot to do.

However, preparation and a thorough understanding of the buyer’s expectations can help to streamline the process and professional advice from your accountant is essential.

Nicola Roby, Director at CHW Bolton Accountants, highlights just a few things to bear in mind.

A key issue with owner-managed businesses is often who will be around to run things when the shareholder exits?  Often, client relationships will be with the vendor, leaving the buyer to question how the business will be affected once the deal is done.

Will these clients be lost?  Who else knows the business well enough to tackle operational issues which may arise post sale? Therefore, implementing a strong management team prior to your exit provides the buyer with confidence that the business they are buying will continue to be successful post completion.

Organisation of, and accessibility to, financial records is paramount to minimising the impact and interruption of the due diligence process. The buyer will want to review your accounting records for at least the last two years and a well-organised, clean audit trail will again reassure the buyer that there are no hidden skeletons.

Consider, are your HMRC liabilities paid up to date? Are there any ongoing legal claims which may not be insured?

If you are thinking of selling your business in the next three years, we would advise speaking to us sooner rather than later. Advanced planning and preparation are key to maximising the value of your business.

For advice on any this or any other issue contact Nicola Roby, Director at CHW Small Business Accountants in Bolton on 01204 534 031 or contact us via our enquiry page.

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